Our Portfolio Allocation Summary for July 2025.
We upgrade European small caps to maximum overweight and double down on our existing recommendation to go long European small caps relative to US ones.
The latest data on Asian exports and manufacturing suggest that the global trade outlook remains downbeat. Korean exports in USD terms grew in June by 4.3% y/y. The three-month moving average is 2.2%. Assuming Q2 export shipments…
Our Geopolitical strategists warn that structural and cyclical risks remain elevated despite a fading threat of acute shocks, and recommend booking profits ahead of tariffs and weaker data. President Trump is passing his signature…
Acute geopolitical risks, like a massive oil shock, may be abating. But structural geopolitical risk remains high and could upset a blithe market. Cyclical economic risks are underrated as the US slows down and China continues to…
Investors should modestly underweight equities in their portfolios and look to turn more aggressively defensive once the whites of the recession’s eyes are visible. We think that will happen within the next few months.
The US-China tariff deal confirms one thing: markets are still priced for perfection, with little upside even if a recession is dodged. The London negotiations yielded a partial agreement: The US will reduce tariffs, and China will…
While we anticipate higher inflation in June, it looks increasingly likely that the price impact from tariffs will be less aggressive and long-lasting than many feared.
Bond market volatility will spike again in the near term. The Fed is committed to an easing cycle yet the Trump administration’s signature fiscal policy action will stimulate the economy. Tariffs are supposed to keep the budget…
The US economy has held up better so far this year than we had expected. For the time being, investors should remain modestly underweight equities. A more aggressive underweight would be justified only once the “whites of the…